logistics – Fortunehttp://fortune.com
Fortune 500 Daily & Breaking Business NewsSat, 10 Dec 2016 03:05:38 +0000enhourly1http://wordpress.com/http://1.gravatar.com/blavatar/dab01945b542bffb69b4f700d7a35f8f?s=96&d=http%3A%2F%2Fs2.wp.com%2Fi%2Fbuttonw-com.pnglogistics – Fortunehttp://fortune.com
Fortunehttps://s0.wp.com/wp-content/themes/vip/fortune/assets/images/fortunelogo.pnghttp://fortune.com25040Google and Blizzard Will Help Researchers Use Starcraft to Train Artificial Intelligencehttp://fortune.com/2016/11/05/google-blizzard-starcraft-ai/
http://fortune.com/2016/11/05/google-blizzard-starcraft-ai/#respondSat, 05 Nov 2016 20:59:57 +0000http://fortune.com/?p=1849488]]>At this week's BlizzCon convention in California, game developer Blizzard announced that it would release tools to allow third parties to teach artificial intelligences to play the real-time wargame Starcraft II. The tools are being developed in collaboration with Google's DeepMind team, and will use the DeepMind platform.

In a blog post accompanying the announcement, the DeepMind team said Starcraft "is an interesting testing environment for current AI research because it provides a useful bridge to the messiness of the real world." The game involves interconnected layers of decisions, as players use resources to build infrastructure and assets before engaging in direct combat.

StarCraft's complexity when compared to Chess or Go, then, makes it closer to the real-world problems faced by computers which do things like plan logistics networks. Those complex systems still present serious challenges for even the most powerful computers, and insights gleaned from StarCraft could help make their solutions faster and more efficient.

One of the most interesting parts of StarCraft's "messiness" is its use of incomplete information as a gameplay parameter. Much of each player's vision is obscured by a 'fog of war,' forcing players to predict one another's decisions while planning their own. That's a challenge not faced by developers of artificial intelligence for Chess, for instance, where the whole board is visible at once.

Another major difference between StarCraft and games like Chess and Go, which computer agents have become increasingly adept at, is that StarCraft unfolds in real time, rather than by turns. That could prove to be an advantage for computer agents, which have more raw processing power than a human brain. Or it may turn out that humans are better at using what brainpower they do have, through the still little-understood phenomena that we call intuition and instinct.

For more on artificial intelligence, watch our video.

However, it seems that StarCraft agents will have to work within some of the same limitations as human players. DeepMind's post says AI players will have to make decisions about controlling the game's camera to learn about game conditions, and execute mouse clicks "within limits of human dexterity."

]]>http://fortune.com/2016/11/05/google-blizzard-starcraft-ai/feed/0lurker-protoss-largedzanemorrisThis Firm Is Spurning Huge Chinese Valuations to Go Public in the U.S.http://fortune.com/2016/10/21/zto-express-ipo-china-us/
http://fortune.com/2016/10/21/zto-express-ipo-china-us/#respondFri, 21 Oct 2016 07:52:15 +0000http://fortune.com/?p=1835734]]>Chinese logistics company ZTO Express is turning up the chance of a much more lucrative share listing at home in favor of an overseas IPO that lets its founder retain control and its investors cash out more easily.

To steal a march on its rivals in the world’s largest express delivery market, it is taking the quicker U.S. route to raise $1.3 billion for new warehouses and long-haul trucks to ride breakneck growth fueled by China‘s e-commerce boom.

Its competitors SF Express, YTO Express, STO Express and Yunda Express all unveiled plans several months ago for backdoor listings in Shenzhen and Shanghai, but ZTO’s head start could prove crucial, analysts and investors said.

“ZTO will have a clear, certain route to raise additional capital via U.S. markets, which their competitors, assuming they all end up quoted in China, will not,” said Peter Fuhrman, CEO ofChina-focused investment bank China First Capital.

With a backlog of about 800 companies waiting for approval to go public in China and frequent changes to the listing rules by regulators, a New York listing is generally a quicker and more predictable way of raising funds and taps a broader mix of investors, bankers and investors said.

U.S. rules that allow founder Meisong Lai to retain control over the company and make it easier for ZTO’s private equity investors to sell their shares were some of the main reasons to go for an overseas listing, according to four people close to the company. U.S. markets allow a dual-class share structure that will give Lai 80% voting power in the company, even though he will only hold 28% of the stock after the IPO.

Most of Lai’s shares are Class B ordinary shares carrying 10 votes, while Class A shares, including the new U.S. shares, have one vote. China‘s markets do not allow shares with different voting power.

ZTO’s existing shareholders, including private equity firms Warburg Pincus, Hillhouse Capital and venture capital firm Sequoia Capital will also get much more leeway and flexibility to exit their investment under U.S. market rules. In China, they would be locked in for one to three years after the IPO.

As concerns grow about a weakening Chinese currency, the New York IPO also gives it more stable dollar-denominated shares it can use for international acquisitions, the people close to the company said.

For more on the IPO market, watch Fortune’s video:

IN DEMAND

Demand for the IPO, the biggest by a Chinese company in the United States since e-commerce giant Alibaba Group’s $25 billion record in 2014, already exceeds the shares on offer multiple times, two of the people said.

That underscores the appeal of the fast-growing company to global investors, despite a valuation that places it above household names United Parcel Service Inc and FedEx Corp .

The shares will be priced on Oct. 26 and start trading the following day.

ZTO is selling 72.1 million new American Depositary Shares (ADS), equivalent to about 10% of its outstanding stock, in the range $16.50 to $18.50 each. The range is equal to 23.4-26.3 times its expected 2017 earnings per share, according to people familiar with the matter.

UPS ups and FedEx fdx, which are growing at a much slower pace, trade at multiples of 17.8 and 13.4 times.

“The A-share market (in China) does give you a higher valuation, but the U.S. market can help improve your transparency and corporate governance,” said one of the people close to ZTO. “Becoming a New York-listed company will also benefit the company in the long-term if it plans to conduct M&A overseas and seek more capital from the international market.”

China‘s express delivery firms handled 20.7 billion parcels in 2015, shifting 1.5 times the volume in the United States, according to consulting firm iResearch data cited in the ZTO prospectus.

The market will grow an average 23.7% a year through 2020 and reach 60 billion parcels, iResearch forecasts.

Domestic rivals STO Express and YTO Express have unveiled plans to go public with reverse takeovers worth $2.5 billion and $2.6 billion, while the country’s biggest player, SF Express, is working on a $6.4 billion deal and Yunda Express on a $2.7 billion listing.

ZTO plans to use $720 million of the IPO proceeds to purchase land and invest in new facilities to expand its packaged sorting capacity, according to the listing prospectus.

The rest will be used to expand its truck fleet, invest in new technology and for potential acquisitions.

“It’s a competitive industry and you do need fresh capital for your expansion, in particular when all your rivals are doing so or plan to do so,” said one of the people close to the company.

]]>http://fortune.com/2016/10/21/zto-express-ipo-china-us/feed/0Chairmen of 6 China's Express Companies Deliver In Hangzhoutohm235FedEx Is Investing $1.54 Billion to Double Capacity at This Airporthttp://fortune.com/2016/10/18/fedex-paris-airport/
http://fortune.com/2016/10/18/fedex-paris-airport/#respondTue, 18 Oct 2016 09:49:49 +0000http://fortune.com/?p=1830944]]>Package delivery company FedExfdx said on Tuesday it would invest 1.4 billion euros ($1.5 billion) to double the capacity of its logistics activities at Charles de Gaulle International Airport in the Paris suburb of Roissy.

The initial investment by the U.S-listed firm will amount to 200 million euros ($220 million) for the extension of its facility in Roissy, the remaining 1.2 billion euros representing the guaranteed total amount of rent over 30 years.

Under the plan, the U.S. group plans to open a new package sorting facility in 2019, creating between 200 and 400 jobs, according to a document handed out during a visit by President Francois Hollande.

“The opening of this facility is an additional sign of France’s attractiveness,” Hollande said.

“With the decision by Britons to leave the European Union, it should lead us to attract even more investments,” he added.

The extra 25,000 square metres of space will make FedEx’s Roissy center its second biggest in the world after the one in Memphis in the United States.

Delivery service company TNT Express, which was bought in May by FedEx, also plans to open a new facility in the Parisian region, according to the same document.

]]>http://fortune.com/2016/10/18/fedex-paris-airport/feed/0Fed Ex Acquires TNT Express For $4.8 Billiontohm235These Tech Firms Are Caught Up In the Hanjin Shipping Debaclehttp://fortune.com/2016/09/07/hanjin-samsung-hp/
http://fortune.com/2016/09/07/hanjin-samsung-hp/#respondWed, 07 Sep 2016 10:04:57 +0000http://fortune.com/?p=1788274]]>Samsung ssnlf really is having an irritating couple of weeks—not only is it having to recall its flagship Note 7 phone over exploding-battery concerns, but it’s now revealed that about $38 million worth of its products and components are stranded on board two Hanjin ships.

Hanjin Shipping, like Samsung a South Korean firm, collapsed last week. Ports are blocking dozens of its ships and it’s desperately trying to avoid the vessels’ seizure by creditors.

Meanwhile, there are 304 containers packed with parts and finished products for Samsung’s visual display unit. All in all, Samsung is having to contemplate organizing air transport for 1,469 tons of goods.

And it’s not the only tech company caught up in the Hanjin mess. Per the Wall Street Journal, Hewlett-Packardhpe also has 500 containers of its Chinese-made computers on the South Korean firm’s ships.

For more on the Hanjin debacle, watch our video.

HP said it desperately needed to get those PCs and printing supplies off the ships and into stores because of promotions ahead of the holiday season—142 of the containers are bound for the U.S. and HP said failure to offload the stock would cause “irreparable harm” to its business.

Fortunately for HP, U.S. bankruptcy judge John Sherwood on Tuesday granted Hanjin temporary protection from its creditors, to allow its ships to dock and offload.

]]>http://fortune.com/2016/09/07/hanjin-samsung-hp/feed/0Container Shipping Operations At Port Of HamburgsuperglazeSmart Cars Will Soon Be Useful For More Than Just Drivinghttp://fortune.com/2016/07/26/daimler-smart-dhl/
http://fortune.com/2016/07/26/daimler-smart-dhl/#respondTue, 26 Jul 2016 10:12:47 +0000http://fortune.com/?p=1748209]]>The German car giant Daimler ddaif has announced a partnership with DHL dpsgy that will see packages delivered directly into the trunks of Smart cars.

The “Smart ready to drop” service went through field testing with 30 drivers last year, and in the fall it will progress to a beta test in Stuttgart, then Cologne, Bonn and Berlin. Daimler said the service will eventually roll out to seven cities in Germany.

A spokesperson for Daimler told Fortune that, while the beta test is limited to Germany, the service may roll out abroad if the results show that customers use the service enough.

Smart drivers who sign up to the beta test will get a free “connectivity box” retrofitted to their vehicles, essentially to make their car a “connected car” (the box will come preinstalled in a special edition of the Smart Fortwo in the fall).

They will be able to generate a transaction number in a Smart smartphone app, for inclusion in the “c/o” field of the delivery address. The app then tells the delivery driver where to go. Similarly to Volvo and Urb-it’s system, the delivery driver will be able to use the transaction number to open the trunk of the recipient’s Smart car within a certain time window.

Once the package is in the car, the delivery driver locks the trunk automatically and the transaction number immediately expires.

For more on the auto industry, watch our video.

The service was developed in Daimler’s Smart Lab thinktank, which aims to come up with “creative urban mobility projects.”

As with other car manufacturers, Daimler is trying to diversify its traditional model as (depending on who you listen to) mass car ownership looks less certain in the future. With cars being parked most of the time, it certainly makes sense to find new ways to use them.

On Tuesday, Daimler also announced the merger of its MyTaxi ride-hailing service with a British rival, Hailo.

]]>http://fortune.com/2016/07/26/daimler-smart-dhl/feed/0Daimler's Smart cars will be able to take deliveries from DHL.superglazeUber Has Made Taxi Drivers Less Knowledgeablehttp://fortune.com/2016/07/17/uber-taxi-drivers-effect/
http://fortune.com/2016/07/17/uber-taxi-drivers-effect/#respondSun, 17 Jul 2016 13:00:00 +0000http://fortune.com/?p=1724636]]>Gary Englander, 64, has been driving a yellow cab in New York City for 38 years. It was a job he enjoyed--until very recently, that is. "I loved my job," he says. "The independence. The meeting of people and minds. I learned every day."

What's changed for Englander in the last two years? It's not just that ridesharing apps are now in the picture, he says, though he calls Uber a "money-laundering operation." Englander’s issue is that it is now possible for drivers with little-to-no knowledge of city streets to work alongside more experienced--and, frankly, better--drivers such as him, rendering the entire role a commodity.

"They're not good," he says of the thousands of newcomers hired by the ridesharing apps. "And they rely on technology, which also isn't very good."

For more on Uber, watch this Fortune video:

Englander still relies on his decades of experience when it comes to tracking traffic patterns and knowing where to pick up work. The native and proud Brooklynite says the increased competition (and, consequently, lower earnings) are now causing him to leave town. "My income is down, my stress level is up," he laments.

Englander says he and his wife plan to move to San Diego, where he hopes to find "some kind of customer service job." He says he’ll miss being a driver, despite how much the job has changed in an era of mobile apps. Says Englander: “I've met the most wonderful people driving.”

This article is part of the Future of Work article from Fortune’s July 1, 2016 issue. Click here to see the entire package.

]]>http://fortune.com/2016/07/17/uber-taxi-drivers-effect/feed/0TEC.10.06.14.Uber financing.03valzaryaVladimir Putin Promises Russian State Backing for Hyperloophttp://fortune.com/2016/07/10/vladimir-putin-hyperloop-backing/
http://fortune.com/2016/07/10/vladimir-putin-hyperloop-backing/#respondSun, 10 Jul 2016 19:02:29 +0000http://fortune.com/?p=1727847]]>Bloomberg reports that Russian President Vladimir pledged state support for the ultra-high-speed transportation concept outlined by Tesla founder Elon Musk. The authoritarian leader's pledge came in a meeting with Hyperloop One co-founder Shervin Pishevar, and was confirmed to Bloomberg by a Putin spokesman.

Bloomberg does not report that any new formal agreement emerged from the meeting, but Hyperloop One already has a compact with the Russian Transportation Ministry to study building a route between the Russian port in Zarubino and Jilin province in China. Hyperloop One’s major investors include Russian logistics and energy billionaire Ziyavudin Magomedov.

Its relationship with Russia knits Hyperloop One into a much larger project--that between the Chinese government and a coalition of allies to build a Silk Road Economic Belt. The goal of the initiative is to better connect western China with Europe, Russia, and Africa using modern transportation technology.

Musk's 2013 Hyperloop white paper outlined a concept for moving passengers in a capsule levitating through an evacuated tube, at speeds of 700 miles per hour or more. But Hyperloop One, led by Peshavar and former Cisco executive Rob Lloyd, has said it will focus on initially using the technology to move freight. That's assuming, of course, that it can make what is still an exploratory technology work in the real world.

For more on the Hyperloop, watch our video:

With Putin’s support in Russia, Hyperloop One is looking even more like the hyperloop startup to watch. It has preliminary agreements and feasibility studies underway with several other cities and countries, and recently completed a study of a route between Helsinki and Stockholm.

Hyperloop Transportation Technologies, the other notable company working to deploy the Hyperloop, has an unspecified preliminary agreement with the Slovakian government, as well as with the Quay Valley development in California. But the Hyperloop One team have been openly contemptuous of Hyperloop Tech's efforts and business model, essentially accusing their competitor of peddling vaporware.

]]>http://fortune.com/2016/07/10/vladimir-putin-hyperloop-backing/feed/0sunset-in-paradise_1462899848dzanemorrisSon of the Circus Thrives as Crude-Oil Traffic Cophttp://fortune.com/2016/06/05/tim-holan-logistics-expert/
http://fortune.com/2016/06/05/tim-holan-logistics-expert/#respondSun, 05 Jun 2016 13:39:00 +0000http://fortune.com/?p=1685921]]>The rows of traders who line the massive trading floor at Mercuria Energy Group’s Houston headquarters rely on a string of modern conveniences to execute deals across the globe. But when they’re under the gun to deliver oil fast, they call one person: Tim Holan.

That’s because Holan, the head of logistics for the trading firm, cut his teeth on moving an even heavier cargo: Elephants.

They, along with lions, clowns and other performers were part of the mile-long moving city that Holan spent nearly two decades shuttling around the country as logistics manager for the Ringling Bros and Barnum & Bailey Circus.

Unruly animals, however well-trained, have a way of making the shipping of thousands of barrels of crude oil every day seem a bit less hectic.

“Crude oil is easier,” Holan said. “There is a specific infrastructure built for oil with the idea that there would be repeat business. With the circus, there’s always one-off moves and unpredictability.”

Holan’s own journey, which includes stints removing radioactive dirt from nuclear facilities and coordinating helicopters for airlifts after Hurricane Katrina, began in 1977, when at the age of 14 he ran away from his Pittsburgh-area home.

He got a job sweeping out the trains at Ringling Bros in California, lying about his age on his application to secure work.

“It was a different era,” said Holan, who is now 53. “Everyone knew I lied about my age, and that would never happen now. Looking at it now, I mean, what was I thinking, but at 14 it just seemed like a big adventure.”

Holan’s father, Rich, who once worked in the administration of U.S. President Ronald Reagan, said it was painful to see his son run away from home.

“It was a bad thing, but it all worked out,” he said in a phone interview. “He made some bad decisions at a young age, and he made some great ones.”

Ringling Bros is considered the world’s largest private train operator, running two separate trains of 60 rail cars, each stretching more than a mile. Holan thrived in the circus’s apprentice-style culture, working his way up to trainmaster and then general manager, where he was put in charge of coordinating the journeys. He never missed a show during his time there.

During long hauls, such as trips from Dallas to Philadelphia, Holan would have to stop the train to make sure the animals were fed and bathed.

“Whether it was a field in Iowa or a parking lot in Chattanooga, Tennessee, we had to find a spot to unload all the animals from the train,” Holan said. “The train operators would often know in advance where we were going, and they would bring their families to get a glimpse of the show.”

New York was the most challenging destination, as Holan had to park the cars in Queens, with a short window in the middle of the night to parade the animals through the Queens Midtown Tunnel on the way to Madison Square Garden.

“It was always funny to watch the face of someone who walked out of a club in the morning to see an elephant walking the streets,” Holan said.

For much of his career with the circus, Holan’s secret weapon for dealing with the unexpected was a roll of quarters. In the case of a snag on the rails, Holan would scramble to locate a pay phone to contact his roster of contacts when problems arose, using the information gained to chart a different route.

After shows, the equipment had be to meticulously reloaded into the cars, with little margin of error and under deadlines laid out a year in advance.

“Everything was measured within a half inch so it would fit in the cars. The circus is a model of efficiency,” Holan said.

For more on oil, watch:

The biggest challenge he has faced during his days at the Swiss trading giant was during the oil rail boom during 2014 and early 2015, when space on rails was scarce. He said rail profit margins are slim, and delays can quickly put a trade in the red.

“The rail operators put too many cars on the lines. That was the problem. They could have moved more volumes, with less cars because speeds would have been higher,” Holan said.

How did he navigate this stretch? By way of his contacts on the rails during his time in the circus, which gave him insight into alternative routes and a network of sources who could provide unique details about unexpected problems. The quarters are gone, though; Holan relies on email and text messages to uncover problems.

Crude rail volumes have dropped significantly in the past year as the economics have favored waterborne imports, leaving a trail of unused tank cars and plenty of uncertainty about the future of the business.

“I think it’s probably fair to say that crude by rail has hit its high-water mark, but I don’t think its gone forever,” Holan said. The power of rail, he added, is that it can quickly be called back into action when market conditions change, for example during supply disruptions.

That kind of juggling suits a guy who spent his years keeping balls in the air to get circus clowns to their shows on time. Unlike the circus, which only had the train, oil at least has the option of pipeline, rail, ship or truck.

“For a logistics guy, options are a best friend,” he said.

]]>http://fortune.com/2016/06/05/tim-holan-logistics-expert/feed/07. HoustonemmieodeaWhy GrubHub’s CEO Isn’t Worried About Uber, Postmates, or Even Amazonhttp://fortune.com/2016/05/04/grubhub-delivery-ceo-interview/
http://fortune.com/2016/05/04/grubhub-delivery-ceo-interview/#respondWed, 04 May 2016 17:36:48 +0000http://fortune.com/?p=1646553]]>GrubHub is long past the hot young startup phase of getting headlines for merely delivering burritos and sushi to hungry customers. But CEO Matt Maloney isn’t worried, and in fact, he’s glad.

After posting mixed results for the year’s first quarter (revenue is up, profits are down), Maloney dismissed the threats from newcomers in the food delivery market like Uber, Postmates, DoorDash, and even Amazon’s new delivery service for restaurants.

"Uber and Amazon are the new boogeymen in the market," Maloney said during GrubHub’s quarterly earnings call on Tuesday. "I think last year there was more concern around venture-backed startups that ended up not being quite as competitive as people were worried they would be," he added.

For many years, GrubHub, which Maloney co-founded with Mike Evans in 2004, focused on simply providing a website where customers could browse and order from local restaurants that deliver. For a while, this proved to be a great business, and GrubHub eventually went public after merging with another popular service, Seamless.

Then in early 2015, GrubHub took the plunge and began to offer its own delivery service for restaurants that don’t do it themselves, a move directly competing with those startups Maloney says he’s not bothered by. Though some of these companies like Uber and Amazon have large operations and bank accounts, Maloney says they’re far from experts in getting meals to people’s doorsteps.

"Uber gets crushed in the App Store," he said in an interview with Fortune about Uber’s new food delivery-focused app, UberEats, which he claims is failing to get great reviews from users. "Right now, you’re hearing Uber say ‘We’re going to get it to you in half an hour’--that’s bullcrap.”

Maloney also took a shot at Amazon, which recently expanded its food delivery service for Prime members to San Francisco, its eighth city, by claiming that the e-commerce giant doesn’t have a competitive advantage. Sure, Amazon amzn has mastered logistics when it comes to shipping and even short-order delivery, but food is another ball game. Just because it built a service, it doesn’t mean it will be able to convince its customers to use it.

And that’s a big problem, according to Maloney. "The logistics business is crummy, it has bad margins," he said, adding that "the only thing that matters here is volume of orders." While GrubHub incurs much of the same expenses as all other delivery services, like paying drivers, Maloney touts GrubHub’s market share.

"Because we have the volume, we don’t have to fake it ’til we make it like the venture guys," he said. GrubHub’s delivery now rakes in $250 million in gross food sales on an annualized run rate, still only a fraction of GrubHub’s overall gross food sales. In 2015, its gross food sales totaled $2.4 billion, and in the first quarter of 2016, they topped $712.8 million.

GrubHub grub makes money by taking a commission fee from each order made through its service and charging a small delivery fee. The size of the commission is set by each restaurant and determines how high in search results the restaurant will show up. The higher the fee, the higher up the results.

Some companies haven’t been as lucky with their business models. Meal delivery startup SpoonRocket, for example, nearly shut down before Brazilian company iFood acquired it in March. But overall, investors have grown weary of the financial sustainability of delivery services.

Even GrubHub’s stock price has taken a hit over the past year thanks to a couple of disappointing quarterly earnings and investor concerns over the rise of competing services like Uber.

Unlike his competitors, Maloney has not desire to start delivering flowers, pants, or iPhone chargers to customers, calling it a trap that would only distract his company. "There is so much opportunity just in food delivery, just here, that I could do this for 20 year and not tap out the market," he said.

"I think there’s a lot of misinformation right now, and that’s because a lot of these groups need to raise their next round," Maloney said about upstart rivals and their quest for investment money.

Still, delivery is expensive, and Maloney says he’s happy operating that side of his business on a break-even basis. "It’s a nightmare--go talk to anyone in the on-demand space," he said of operating a delivery service.

"You have to recruit people, you have to train them, you have to get them on a schedule. And by the way, you have to do it without telling them what to do because of the legal implications," he added, hinting at the wave of lawsuits delivery companies, his included, have faced over their use of contractors instead of employees.

]]>http://fortune.com/2016/05/04/grubhub-delivery-ceo-interview/feed/0GrbhubSite-Desktop-HomepagekiakokalitchevaShyp Hires Its First COO as It Gets Serious About Business Customershttp://fortune.com/2016/04/25/shyp-hires-its-first-coo/
http://fortune.com/2016/04/25/shyp-hires-its-first-coo/#respondMon, 25 Apr 2016 17:00:10 +0000http://fortune.com/?p=1635525]]>Like many other startups born during the heyday of Uber-style services, Shyp’s "delightful" shipping services didn’t exactly inspire confidence from everybody at the beginning.

But today, the San Francisco-based company is a full-fledged business that has raised $62.1 million in total funding, currently operates in four cities, and is focused on serving new kinds of customers. And to help it better navigate this new phase of its business, Shyp has recently hired Zeena Freeman as its first chief operating officer. The company’s current vice president of operations will now report to her.

"I've never actually joined a company in a role that existed before I had that role," Freeman told Fortune in an interview.

Freeman, who spent nearly a decade at apparel company Gap, followed by stints at Aeropostal, Aditya Birla Group, Sony, and Black Diamond, is the classic customer-turned-employee story. Like any San Franciscan constantly hearing about and trying out various nifty apps, she gave Shyp a shot and was immediately smitten with the experience.

And that’s exactly what Shyp’s founders have always wanted. Since Shyp’s debut in 2013, the San Francisco startup has set out to make shipping packages as painless as possible. It has a slick mobile app that lets customers snap a photo of what they want to ship and enter the destination. Shyp then dispatches a courier who picks up the item, no wrapping necessary, and takes it to one of the company’s warehouses, where it’s properly wrapped and shipped through the best and cheapest carrier Shyp can find. The company makes money by charging customers the retail price to ship their item while getting bulk discounts from carriers and keeping the difference. It also charges a $5 pick-up fee for up to 20 items.

But since its start more than two years ago, the company has grown not only geographically, but also in the type of customers and shipping needs it services. Today, Shyp doesn’t just help the average Joe mail a gift to his mom for her birthday--it’s also helping an increasing number of what it calls "high-frequency customers." Most of them are small-business owners and frequent sellers on marketplaces like eBay and Etsy. Unlike the typical consumer, they need to ship packages multiple times per week or in large batches, and Shyp has been developing new services and features for them. For example, it recently integrated its app with eBay to let customers request a Shyp courier when they’ve made a sale.

For more on unicorns, watch:

Figuring out how to best serve this growing category of customers is one of Freeman’s main tasks at Shyp. Her responsibilities include operations, business development, marketing, and customer support--a tall order, but one co-founder and CEO Kevin Gibbon believes Freeman is right for.

"The search took a year and a half so it was just a matter of finding the right person," he said.

According to Homebrew partner Hunter Walk, an observer on Shyp’s board and whose fund is an early investor in the company, Gibbon first floated the idea of hiring a COO in mid-2014, shortly after Shyp raised its first institutional round. After it closed its second round in the spring of 2015, the search kicked kicked off, especially with co-founder Joshua Scott’s departure that May. As a company whose business is operations, it became obvious Shyp needed to add a strong leader in that area.

But like any startup, Shyp’s growth hasn’t been all smooth sailing. Last year, just as a high-profile lawsuit over Uber’s classification of its drivers as contractors instead of employees was beginning to make headlines, Shyp announced it was converting its own couriers to employees with benefits.

Then earlier this year, the company suspended its financially inefficient operations in Miami and laid off about 8% of its workforce, a move that "will empower us to invest in growing Shyp's business sustainably," as Gibbon described it in a post on LinkedIn.

But asked if a COO could have prevented the Miami shutdown and recent layoffs, both Gibbon and Walk said no. While Shyp originally sought to expand geographically, it ultimately decided that focusing on its main markets and serving more kinds of customers in them was the better route.

"They started to get pulled into depth of market instead of breadth of market," Walk said of Shyp’s shift in strategy.

And as it digs deeper into its existing markets, Shyp has set a goal an increasing number of fellow Uber-like services are reaching for as well: profitability. The company says it has already laid down the groundwork, but whether it reaches it remains to be seen.

On China's double-digit GDP growth rates of the 2000s slowing to below 7%: "There is no reason to expect that an economy of such size can maintain such a growth rate indefinitely, nor is it good for China to continue to grow at such speed," Ma said."After more than 30 years' growth, spending a few years to adjust its course is reasonable."

Many would agree, though whether China can adjust its course away from the debt-fueled growth of the past half-decade and come out unscathed is now the hot topic among economists. Arthur Kroebel of Gavekal Dragonomics predicted this week China is headed for neither boom nor bust but will spend the next decade in "genteel decline, much as Japan has since the 1990s" as it whittles down a corporate debt mountain that passed 150% of GDP last year (note that that doesn’t even include the equally dazzling rise in local government debt in the meantime).

Ma waded into some criticism of the government, suggesting the headline GDP figure is manufactured, before he spun it positively.

"Some say the actual [growth] number could be just 5%. But even with 5% growth, there is no other economy of such size growing at that speed in today's world."

While that's true, he's really only including the U.S. as competition. China's economy is already more than double the size of the world's third-largest, Japan. India's growth has outpaced China's recently, hitting 7.3% in the fourth quarter to China's 6.8%, but India's economy remains just a fifth the size of China’s.

China's growth will be "enviable to most other major economies for another 15 to 20 years," Ma said.

He painted the recent consumer data as a rebuttal to the country's industrial slowdown. "The traditional industries are struggling, but we also see growth in domestic consumption, the services industry and the hi-tech sector, and young talents are flocking to these areas."

He also said delivery–an industry heavily supported by Alibaba in as much as its marketplaces are responsible for as many as 5 billion packages a quarter, according to estimates--would help absorb some of the low-skill jobs being lost amid China's shift away from heavy industry. Cainiao, the Alibaba-backed logistics shipping company, has said it expects to have the capacity to deliver 100 billion shipments a year as soon as 2021.

"The logistics and delivery industries create plenty of jobs for low-skilled workers,” Ma said. “We still have a lot of room for growth."

]]>http://fortune.com/2016/04/20/jack-ma-on-the-china-doomsayers/feed/0CNBC Events - Clinton Global Initiative 2015scottcendrowskiLockheed Inks $480 Million Deal for Cargo-Hauling Hybrid Airshiphttp://fortune.com/2016/03/30/lockheed-inks-480-million-deal-for-airships/
http://fortune.com/2016/03/30/lockheed-inks-480-million-deal-for-airships/#respondWed, 30 Mar 2016 16:12:15 +0000http://fortune.com/?p=1607093]]>Lockheed Martin lmt has locked up its first order for as many as a dozen cargo-carrying hybrid airships, blimp-like aircraft that the company's secretive Skunk Works lab has been developing for more than a decade.

U.K.-based Straightline Aviation (SLA) has agreed to purchase up to 12 of the vehicles for a collective $480 million, enabling the buyer to deliver cargo to remote locations that lack roads or other infrastructure.

Each of the helium-filled airships measures nearly a football field in length, can haul 20 metric tons of cargo (as well as 19 passengers plus crew), and can land or hover just about anywhere. SLA plans to target the oil, gas, and mining industries, which spend billions on logistics annually, building roads, helipads, and other infrastructure in order to manage moving equipment and personnel to far-flung corners of the world.

For years, Lockheed has positioned its hybrid airship--known as LMH-1--as a cheaper and more sustainable way to move cargo, spurring only lukewarm interest from potential customers. That's changing as persistent low oil prices have altered business models at many of the world's major oil and gas companies.

What was acceptable when oil was at $90 a barrel isn't realistic anymore, SLA Chief Executive Officer Mike Kendrick told Bloomberg in an interview. SLA already has four to five customers ready to give the airships a chance once they're finally in the air, he said.

The LMH-1 is the descendant of a Pentagon program that sought airships as a means of offering around-the-clock aerial surveillance over wide areas during the wars in Iraq and Afghanistan. That program fell victim to shrinking military budgets, a spike in helium prices, and the winding down of U.S. military activity in those conflicts. Lockheed has since spent more than $100 million tinkering with its airship designs, looking for the right size, capability, and markets.

It also marks the first time Lockheed's experimental Skunk Works lab--the company's Palmdale, Calif.-based facility that gave birth to the U.S. military's U-2 and SR-71 Blackbird spy planes, among other iconic aircraft--has turned one of its creations loose in the commercial market.

At this point, it's unclear exactly what that market is. Previous ventures have foretold an airship renaissance only to crash spectacularly, most recently when German company Cargolifter AG collapsed in 2002, losing hundreds of millions of investor dollars. The company's 160-ton CL160 airship never got off the ground.

For more about Lockheed Martin, watch:

Both Lockheed and competitor Hybrid Air Vehicles believe the customers will come. Hybrid Air Vehicles unveiled its Airlander 10 last week, targeting the aircraft more toward the tourism market. SLA might extend into commercial passenger travel at some point in the future as well, though for now the company will focus on what it sees as low-hanging fruit in the oil, gas, and mining industries.

Lockheed can reportedly produce roughly one LMH-1 per month once production begins, and could develop a 90-ton variant by 2019 if adequate demand emerges. The company will begin delivering airships to SLA in 2018.

]]>http://fortune.com/2016/03/30/lockheed-inks-480-million-deal-for-airships/feed/0LMH-1cdillowMinimum Wage Hikes Will Raise E-Commerce Shipping Costshttp://fortune.com/2016/03/19/minimum-wage-ecommerce-costs/
http://fortune.com/2016/03/19/minimum-wage-ecommerce-costs/#respondSat, 19 Mar 2016 20:57:32 +0000http://fortune.com/?p=1593939]]>A report released Friday by the real estate services firm CBRE says that the rising wave of minimum-wage increases at the city and state levels will have a pronounced effect on the warehouses that fulfill e-commerce orders from online sellers like Amazon. With their mostly hands-on picking and pulling methods, those facilities often have large staffs, and CBRE says each $1 increase in average hourly wages would add $1 million in costs to a warehouse with a staff of at least 500.

According to the National Employment Law Project, 14 cities and states approved a $15 minimum wage in 2015, some limited to particular categories of workers, and some, including those in Los Angeles and San Francisco, covering all workers. As the Wall Street Journalpoints out, those rising labor costs are likely to be hard to escape, for a confluence of reasons.

While many industries have in the past relocated away from areas with higher wages, e-commerce customers' rising demand for fast shipping makes it hard, if not impossible, to move distribution centers away from the cities they're serving. In addition to slowing delivery, it would also add transportation costs, which make up a much larger share of supply chain costs than labor.

That means labor costs are likely to be passed on to customers. There are already signs of rising e-commerce shipping prices, such as in Amazon's recent substantial hike in the minimum threshold for free shipping.

For more on e-commerce and logistics, watch our video:

In the longer term, rising wages will also encourage shippers to push harder for automation in their distribution centers. Amazon AMZN already makes extensive use of Kiva robots in its centers. But it also still employs thousands of humans, in often physically demanding roles, who are generally paid between $10 and $14 an hour.

]]>http://fortune.com/2016/03/19/minimum-wage-ecommerce-costs/feed/0FI.Ingram.shelves.D.072298.KRHWarehouse workers pick up orders for games, software, hard drives andzanemorrisStartup BoldIQ Adds Legendary Software Exec Paul Maritz to Boardhttp://fortune.com/2016/03/08/paul-maritz-joins-boldiq-board/
http://fortune.com/2016/03/08/paul-maritz-joins-boldiq-board/#respondTue, 08 Mar 2016 18:00:21 +0000http://fortune.com/?p=1577550]]>Paul Maritz, the former chief executive at VMware vmw and Pivotal after a stint as a top exec at Microsoft, is joining the board of BoldIQ.

The Bellevue, Wash. company focuses on helping companies allocate and schedule big, expensive resources--airplanes, trucks, medical technicians--efficiently, using technology built at Dayjet, a company that helped business people share private jets.

Maritz has history here. He invested in Dayjet, which had great technology but bad timing. “The short version is that I inherited BoldIQ out of Dayjet which was ahead of its time, trying to be the Uber for the private jet business 15 years ago. Unfortunately, it didn’t survive the crash of 2008,” Maritz told Fortune in an interview.

The BoldIQ-Uber comparison only goes so far, Maritz said. “Uber doesn’t require as complex a model because it draws on a huge number of drivers. The air taxi business deals with precious resources. Being able to efficiently schedule them to get more than one passenger on each plane required advanced software,” he noted.

EasyJet’s CEO on why running an airline sucks.

BoldIQ, which has raised just under $8 million in venture funding, is applying that technology to all sorts of businesses including freight delivery, home appliance repairs, hospital staff scheduling, and, yes, aviation.

The appliance service model is illustrative. In the Seattle area, one unnamed BoldIQ customer is able to perform 1000 home appliance service calls per day using 100 technicians. “We have to make sure two things happen, one that the company can provide most of the services needed and two how to do it in a way that’s timely for customers and prevents overwork by employees,” said Roei Ganzarski, chief executive of BoldIQ..

“We also compete with not-invented-here syndrome,”Ganzarski said. His take is that BoldIQ can help aircraft companies, hospitals, and doctors schedule resources in a way that’s more efficient for both the provider and the consumer of the service, without any of those providers having to build their own scheduling system.

So what’s BoldIQ’s secret ingredient for handling all this complexity? “Russian rocket scientists,” Maritz and Ganzarski said almost in unison. “We’re not kidding,” Maritz added. The company’s team profile does indicate the presence of quite a few Russian techies..

“If you can help an aircraft operator cut 50% of costs and make 20% more flights, everyone wins,” he noted. BoldIQ takes a cut of any savings.

Businesses can run BoldIQ’s software on Amazon amzn Web Services, Microsoft msft Azure public clouds, or on their own internal systems, Ganzarski said.

]]>http://fortune.com/2016/03/08/paul-maritz-joins-boldiq-board/feed/0fortune-brainstorm-tech-2014-paul-maritzbarbaraadarrowWhy China and Nicaragua’s Canal Project Is Flounderinghttp://fortune.com/2016/02/29/china-nicaragua-canal/
http://fortune.com/2016/02/29/china-nicaragua-canal/#respondMon, 29 Feb 2016 17:25:46 +0000http://fortune.com/?p=1565576]]>The expansion of the Panama Canal has overcome labor disputes, legal battles, and technical hurdles, and is now on the verge of completion. Infrastructure projects of such massive scale almost inevitably face big delays and cost overruns--but backers have a way of finding the money and resolve to finish what they've started.

That may not apply, though, to a project that aims to build a $50 billion, 172.7-mile canal across Nicaragua--almost four times longer than Panama's. The passage is intended to compete for inter-ocean traffic by servicing ships too big to pass through even Panama's expanded canal, and would be one of the largest infrastructure projects in human history.

Nicaragua and its people could certainly benefit from a working canal. Panama's has driven double-digit growth in recent years, anchoring a transport sector that makes up a quarter of the country's $42.65 billion GDP as of 2013, and helping push per-capita income above $11,000. Nicaragua, by contrast, is the poorest country in Central America, with GDP of just $11.26 billion in 2013, and per-capita income of just over $1,800.

But the project faces obstacles as big as its ambitions--many of them internal. Chinese billionaire Wang Jing, who heads the Hong Kong Nicaragua Development Group that's leading the project, has personally funded much of the preliminary work--but in 2015, he lost more than 80% of his fortune in the Chinese stock market rout. Financial problems, along with ongoing environmental and engineering reviews, are causing rolling delays.

The appearance of problems has only been heightened by officials' unusual communication strategy. As of August of last year, journalists found no evidence of actual construction, while the Nicaraguan government insisted ground was being broken. Organizers have remained insistent on a five-year timeline for the canal's completion, even though the shorter Panama Canal took more than a decade to build.

For more on China and the world, watch our video.

It's also uncertain how, or if, the canal would actually work once completed. Captain Andrew Kinsey, a longtime merchant sailor with Maersk who is now a maritime risk consultant with Allianz, points out that it currently takes a "long day" for a ship to make the 48 mile trip along the Panama Canal. The currently-proposed 172.7 mile route of the Nicaragua Canal would require that ships either lay up at night, or navigate in the dark.

There are also deep questions about the canal's economic fundamentals. Though hardly disinterested, executives with the Panama Canal Authority have estimated that the actual cost of Nicaragua's project will likely reach $100 billion, and fees would have to be more than double Panama’s. The two canals are geographically close enough that price and safety would be their main distinguishing features.

"I don't think it's driven by a viable business plan with regards to ocean freight," says Kinsey. "The political and economic motivators are driving it."

Experts on Chinese business practices agree. Usha Haley, a professor of management at Western Virginia University, says the Nicaragua Canal and similar Chinese projects in the developing world are driven not by practical calculus, but by "a desire for influence, power, and money."

Haley spent nearly a decade researching the complex and opaque system of subsidies that have helped Chinese businesses flourish. That has included, she says, many highly-touted international development projects, from telecom to tourism, and whose actual completion seemed like an afterthought. Instead, Haley says, their primary purpose has been transferring Chinese government loans to local officials, and bolstering China's international influence and profile.

"There's a lot of collusion between these senior government of officials, like [Nicaraguan President Daniel] Ortega, and the Chinese development bank, and the Chinese companies," says Haley. "There is a lot of leakage of funds, not only to the companies, but also to the governments of these emerging economies."

Even after years of digging, Haley says evidence for corruption lies mainly in the plethora of failed projects, because of a near-total lack of financial transparency.

]]>http://fortune.com/2016/02/29/china-nicaragua-canal/feed/0#G5002015 Noble GroupdzanemorrisWhy UPS Invested In A Same-Day Delivery Startuphttp://fortune.com/2016/02/24/ups-invests-in-deliv/
http://fortune.com/2016/02/24/ups-invests-in-deliv/#respondWed, 24 Feb 2016 19:32:14 +0000http://fortune.com/?p=1560718]]>United Parcel Service has delivered a box full of cash to a startup that could one day be a competitor.

Same-day-delivery startup Deliv announced on Wednesday that it has raised $28 million in funding led by UPS’ venture-capital arm. Several other venture capital firms including Upfront Ventures and RPM Ventures also participated in the round.

Deliv was founded in 2012 to help local retailers, businesses, and e-commerce companies deliver products to customers on the same day orders come in. The company operates in 100 U.S. cities on behalf of 4,000 partners including major retailers Macy’s M and Best Buy BBY.

Deliv is trying to gain traction in an increasingly important battleground for both e-commerce giants and brick-and-mortar stores. Over the years, e-commerce companies have grappled with getting products to customers’ homes more quickly to remain competitive.

Brick-and-mortar stores are ready for customers to walk in and shop anytime. Online retailers, however, must take orders and deliver them to customers through traditional logistics companies like UPS UPS or FedEx FDX. That takes at least a day, depending on how much the customer is willing to pay.

To level the playing field, Amazon AMZN has been among the most aggressive online retailers in offering same-day delivery. It currently offers its Prime customers free same-day delivery on orders of $35 or more in 16 metro areas. In the coming months, the company plans to expand its same-day delivery to others cities to make it easier for more customers to get their products the same day they’re ordered.

Same-day delivery is also of interest to traditional logistics companies. As Deliv’s current client list shows, large retailers are thinking of ways to get products to customers more quickly, and some logistics companies are looking to fill that void.

UPS is already offering same-day delivery for a few industries including healthcare and the replacement parts market for major manufacturing. Now, it’s clearly seeing even more promise.

“We see this as a growing segment of the industry, so one of the reasons we invested was to learn more about the market and customer requirements and see our investments as a way to gather information to make future decisions about our business,” UPS spokesman Steve Gaut told Fortune.

In other words, UPS is willing to give what could be a future competitor for same-day deliveries some cash to learn more about the emerging same-day delivery market. But UPS still has some questions about the near-term prospects.

“Today, for UPS, we don’t see the economics for same-day delivery for retail packages as currently fulfilled by Deliv,” Gaut said. “What we’re doing is seeking to better understand the marketplace so it will guide our decision-making.”

Indeed, it’s a tack UPS takes often with its venture capital arm, called the Strategic Enterprise Fund. In his interview with Fortune, Gaut said that UPS’ venture capital fund is used for researching startups that are already at work in their particular industries. He argued that it’s often a better use of resources to invest in a company rather than to test ideas internally.

For more on same-day delivery, watch:

“We learn from them without having to make the internal investment,” he says.

Despite potentially letting a big competitor in on its business, Deliv doesn’t seem too concerned. In a statement, the company’s CEO Daphne Carmeli said that Deliv is “thrilled with this strong vote of confidence from the UPS Strategic Enterprise Fund.” Carmeli added that the investment round will help the company stay ahead of the “fast-growing, multibillion dollar same-day delivery market” by expanding to more U.S. cities.

Whether UPS will push into same-day delivery for retailers remains to be seen. In his interview with Fortune, Gaut says no decisions have yet been made.

]]>http://fortune.com/2016/02/24/ups-invests-in-deliv/feed/0Inside A United Parcel Service Inc. Distribution Facility On Cyber MondaydreisingerTrucking Camera Maker Lytx Acquired for $500 Millionhttp://fortune.com/2016/02/19/trucking-camera-maker-lytx-acquired-for-500-million/
http://fortune.com/2016/02/19/trucking-camera-maker-lytx-acquired-for-500-million/#respondFri, 19 Feb 2016 21:11:01 +0000http://fortune.com/?p=1556123]]>Lytx, the leading maker of cameras for monitoring truck drivers, will be acquired by the Chicago-based private equity firm GTCR for a cash payment of $500 million. Lytx's venture funders have included Insight Venture Partners, JMI Equity, and Menlo Ventures.

Founded in 1998, Lytx initally focused on providing monitoring for passenger vehicles, later offering a system recording driver behavior during unusual road events and then transmitting footage back to Lytx for analysis. For trucking companies, this provides potentially useful legal evidence because while car-truck collisions often result in large settlements, truckers themselves are at fault in only 30% of accidents.

In announcing the acquisition, Lytx said its current leadership will remain in place while expanded resources would help them provide a broader range of services. The acquisition is expected to be finalized by the end of March.

As Fortune reported last spring, cameras used to monitor truck drivers are experiencing fast adoption in the trucking industry. Last year, Lytx added 102,000 new systems across 365 companies. That included one of the largest contracts to date in the category, installing cameras in more than 6,000 trucks owned by Swift Transportation. The company provides ongoing services on a subscription basis and says it signed $200 million in new contracts in 2015 - 80 percent more than in 2014.

That's one heck of a year, but Lytx does face two potential headwinds. First, while they're like catnip to fleet owners, truck drivers truly hate driver-facing cameras, which they say invade their privacy and compromise the solitude that drew many of them to the job in the first place. So far, operators like Swift haven't responded to those concerns in any very concrete way, and a concerted backlash by drivers could conceivably push the cameras out of favor.

Second, Lytx's driver cameras are almost certainly a transitional technology as the trucking industry is moving inexorably towards automation and, eventually, self-driving trucks. The National Highway Traffic Safety Administration is currently considering mandating automatic emergency braking systems in trucks, and Daimler is already demonstrating fully-automated trucks. With a broad consensus that self-driving passenger vehicles could be on the road by 2020, trucks can't be far behind - and an artificial intelligence doesn't need a camera keeping an eye on it.

For more on transportation technology, watch our video.

Lytx has taken some steps that help prepare it for that shift, including an add-on to its camera system that provides drivers with alerts when they stray out of their lane or follow another vehicle too closely. That detection and decision technology could be integrated into more advanced forms of automation or autonomous driving.

You may not know it by name, but you probably recognize the world's most unlikely self-driving vehicle--that squat, rectangular platform, those four little wheels, and the accordioning supports that lift workers into the air.

In a project kicked off last December, the mobility software firm 5D Robotics has partnered with United Rentals to help the heavy-equipment leaser's scissor lifts load, unload, and park themselves in storage yards. The technology, which will replace labor-intensive remote control, is currently being rolled out to United Rentals' 900 equipment yards across the U.S.

5D Robotics wound up working on such an unlikely platform because their so-called "Behavior Engine" navigation software can be plugged into any vehicle equipped for remote control. "It doesn't matter if it's a two-pound drone or a 7,000 pound car," says spokesperson Phil Mann. That opens the door for a broad array of applications, with the company currently exploring many in industry. Mann says setting up a system like United Rentals’ can take as little as a few hours.

5D was born out of work at the Idaho National Laboratory, where co-founders David Bruemmer and Scott Hartley were working to solve mobility problems for the military. The two initial goals for the technology were carrying heavy loads for soldiers on foot, and making IED-detecting robots smarter. The software has already been used in more than 20 different robot models. Though the company was founded in 2009, Mann says they’ve only begun to pursue commercial applications over the last 18 months, with United Rentals the first client to go live.

5D's military origins led to another unique aspect of their technology. While most autonomous vehicles in development rely on a combination of satellite GPS and onboard sensors, 5D adds Ultra Wide Band signals, or UWB. The signal, broadcast from a group of stationary beacons, give vehicles within a roughly 200 foot range location data accurate to 2 centimeters--trouncing GPS's accuracy of 3 or 4 meters. UWB also works better than lasers or cameras in darkness or inclement weather (though 5D's Behavior Engine can also work with those other inputs), and is resistant to interference from dust or competing signals.

For more on the future of heavy equipment, watch:

Of course, the need for signaling hardware on the ground is a limiting factor, which is why 5D has so far focused on more enclosed applications like factory floors, dockyards, and parking lots (though Mann says large-scale installation on highways is a future possibility). The system can create virtual 'rails' for vehicles to follow, similar to what some factories currently accomplish with magnetic tracks set into the floor, but much more flexible. The system also has the ability to avoid workers or other vehicles.

All advances in automation force us to think about the consequences for employment. 5D's early forays, though, are landing in areas--construction, heavy machinery, logistics--that feed the dwindling pool of good-paying semi-skilled work. When asked about the company's potential impact on labor, Mann emphasizes the benefits.

"If we can increase the safety and reliability, then there are other things for humans to do. The amount of people who get injured or even killed by forklifts--you can eliminate that with automation." And, indeed, Mann says 5D is developing programming for forklifts, potentially enabling autonomous movement of heavy loads around a warehouse.

But ultimately, 5D's tech is a reality check for workers (and companies) either unwilling or unable to adapt.

"When the alternator failed, it actually locked up and spun the belt off the engine. It could have been a more serious situation, where the engine was run with no belt on it," says Tanzer.

"[That] would have absolutely left the bus on the side of the road with elementary school kids aboard."

Tanzer oversees more than a hundred school buses as Fleet Supervisor for the Saratoga Springs City School District in upstate New York, and roadside breakdowns are his worst nightmare. “We have to dispatch another bus, and we have to literally remove those kids on the side of the road from one vehicle to another. [It’s an] extremely dangerous situation.” According to Federal statistics, more than twice as many fatalities occur outside a bus than inside.

Luckily, this time, the bus itself sent Tanzer a notification through OnCommand Connection, a remote dashboard provided by the Illinois-based bus manufacturer IC Bus. Tanzer was able to send mechanics to fix the bus before it got back on the road.

Today's school buses are a far cry from the smoke-belching claptraps you might remember. Like modern cars, they have a half dozen computers monitoring the engine, braking, transmission, and other systems. OnCommand, which originated with IC Bus parent company Navistar's nav trucking products in 2013, collates that data and provides an overview of dozens of vehicles at once.

That comes in handy for Tanzer when his district gets a day that's, let's say, a little chilly.

"It's not uncommon in the winter for us to see 20, maybe 25 [degrees] below zero without windchill," says Tanzer. "That can take its toll on batteries." Tanzer can access the OnCommand dashboard from his smartphone, so he knows which buses will need the most help before he even leaves home in the morning.

In addition to keeping kids safer, that monitoring can save districts a lot of money.

"Every time a vehicle fails on the side of the road, there's substantial cost involved with retrieving that," says Tanzer. "A tow truck doesn't come cheap." With fewer repairmen out on calls, there's also more time for preventive maintenance.

For more on education and tech, watch:

The OnCommand system first became available to schools about two years ago, and IC Bus says it now has nine customers running it on 1,500 buses. But the company is pushing hard to expand, saying it hopes to have 50,000 buses online by October 2016.

We're quickly getting used to talkative computers in our cars, keeping us safer and more informed. But as Chuck Tanzer’s story shows, connected technologies are beginning to expand far beyond private vehicles--with impacts that may be even more profound.

]]>http://fortune.com/2016/02/16/connected-school-buses/feed/0ICBusdzanemorrisHyundai Ocean Shipping Announces Major Selloff to Stay Afloathttp://fortune.com/2016/02/04/hyundai-ocean-shipping-selloff/
http://fortune.com/2016/02/04/hyundai-ocean-shipping-selloff/#respondThu, 04 Feb 2016 17:52:16 +0000http://fortune.com/?p=1537820]]>The Wall Street Journalreported this week that Hyundai Merchant Marine, a major global ocean shipper, says it will sell some of its shipping facilities and its holdings in a financial unit. It's one of the biggest signals so far of the severity of the problems facing the global shipping industry, and may be the last hope for Hyundai Merchant to avoid bankruptcy.

Hyundai Merchant Marine has lost money every year since 2011. A combination of slowing global trade and a massive glut of shipping capacity have pushed cargo rates to historic, and sometimes absurd, lows. Carrier profits have been devastated worldwide, including at industry leader Maersk.

Hyundai Merchant Marine is the largest component of Hyundai Group, the South Korean conglomerate that also includes tourism and construction businesses (Hyundai Motor Group and Hyundai Heavy Industries are separate entities). Its stock price has dropped more than 90% since 2010, its debts are now nearly eight times its market value, and its cash on hand is meager.

Slowing trade, particularly between China and Europe, is the headline culprit. But another huge factor is the arrival in recent years of the next generation of supersized cargo ships. Thanks to economies of fuel and crewing, these megaships are cheaper to operate per unit of volume shipped, and all major shippers have adopted them to stay competitive.

But (in a parallel of the current world oil glut) the wave of bigger ships has produced massive overcapacity, slashing profits and, ironically, leading to the mothballing of some of the very same ships.

There is no solution to the capacity problem in sight, and shippers are starting to falter under the pressure. After last year's announced merger of China's COSCO and China Shipping Group, industry watchers began predicting a broader wave of consolidation. December saw a $2.4 billion offer for Singapore's Neptune Orient Lines by France's CMA CGM, with a sale likely to go through this year.

For more on Korean industry, watch our video.

The NOL offer was at a slight discount, and CGA CGM is now buying open-market shares for even less than its offer. That points to yet another grim aspect of the situation--shipping assets that were a major investment just a few years ago have lost significant value in the current environment, making exits from container shipping unattractive, even in the face of losses.

In Hyundai Merchant Marine's struggle for survival, the proposed sales are no silver bullet. This week's announcement follows a previous unsuccessful attempt to sell off Hyundai Merchant's financial holdings, and analysts speaking to the Journal said that even if successful, Hyundai Merchant's yard sale might not save it from bankruptcy.